Measuring Corporate Culture

This article was originally published on Robert Murray’s personal website. Read the original article here.

Almost every organization on the planet these days is talking about improving their corporate culture. I truly hope (and yes, I know ‘Hope’ is not a management tool) that they are serious about it and it is not just another corporate program to make employees believe that management cares.

Measuring Corporate Culture

I say that because I have sat in WAY too many boardrooms where senior leaders talk about culture however, they really don’t believe in it because… they struggle with measuring corporate culture. It is much easier to closely monitor monthly KPI’s (Key Performance Indicators) and make small monthly corrections in order to deliver short-term targets. Most leaders struggle to see the direct correlation between Employee Engagement, High Performance, Customer Satisfaction and Profit.

A fairly recent study by the Gallup organization in 2015 of 70 North American-based organizations found that, on average, only 3 out of 10 employees are engaged at work. Wow! Further, they discovered that 7 out of 10 employees are either disengaged or actively disengaged (meaning that this group doesn’t care if the business does well or not) at work. See Figure 1 below…

Figure 1

Further, a 2011 study by Keller and Price and published in the McKinsey Quarterly, discovered that Top Cultures have a significant financial return versus disengaged cultures or bottom cultures. See Figure 2 below…

Figure 2

The ROI on Corporate Culture

High Performing Cultures do have an impact on Revenue, Productivity, Customer Satisfaction and Costs. The BIG problem is that most leaders struggle with it because they are:

Classically trained in MBA programs to think only with their logical analytical brains that look for tangible measurements

Driven by short-term results and fail to see the long tail view

Comfortable making hiring decisions based on resumes and interviews versus seeking value and culture which fits in with the organizational culture roadmap

Uncomfortable making authentic emotional connections with their people